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Updated Dec 12, 2023

Human Relations Movement: How It Changed Management

Learn how this critical shift in management ushered in more personalization.

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Max Freedman, Business Operations Insider and Senior Analyst
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This guide was reviewed by a Business News Daily editor to ensure it provides comprehensive and accurate information to aid your buying decision.

Table of Contents

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The first management theory, Frederick Taylor’s scientific management theory, dates back to 1911. From there, many others were born, including Max Weber’s bureaucratic theory and Mary Parker Follett’s theory of organizational management. These varied theories ultimately spawned the human relations movement, representing a crucial shift in management that encourages more personal oversight. Here are the basics of the movement and how it affected today’s management style.

Did You Know?Did you know
Other management theories to investigate include Peter Drucker's management theory and Henri Fayol's principles of administrative management.

Who started the human relations movement?

The human relations movement was born from the Hawthorne studies, which Elton Mayo and Fritz Roethlisberger conducted from 1924 to 1932. Initially, the studies focused on how physical conditions, like lighting and other aspects of your work environment, affected workers’ productivity. However, the studies found that one of the most significant factors influencing employee performance was whether they were being observed by others.

In other words, relationships between workers and management affect employee efficiency. If workers are being analyzed by their boss, they will be more motivated to do well – a phenomenon known as the Hawthorne effect.

Being part of a group and having a specific responsibility in that group also increased employees’ motivation. Workers want to feel that their personal goals and development goals align with their team’s overall goals and that their work is valuable.

Human relations vs. human resources

Some, if not most, employee management styles are predicated on the tenets of the human relations movement. All employee management styles require the use of human resources (HR), not to mention a full-time HR person or a department devoted to HR. This distinction raises the question: How do human relations and human resources differ?

Human relations

Human relations encompass all interactions between employees and your company. That means how your employees interact with you, the work environment, other employees, clients and anyone they come into contact with in the course of their duties. Human relations aims to ensure your employees are as happy and productive – not the latter at the expense of the former – as possible.

Human resources

Human resources somewhat disregards interpersonal interactions and treats your employees primarily as resources. An HR manager or outsourced HR firm may view your team as largely another cog in your machine while occasionally thinking about individual members’ wants and needs. This distinction stems partly from the fact that your HR team may be responsible for minimizing your risk, a task sometimes at odds with boosting employee morale.

Key TakeawayKey takeaway
Human relations concerns employee happiness, whereas human resources centers around your business.

Theory X and Theory Y

Management professor Douglas McGregor later created Theory X and Theory Y, two opposing perceptions of employee motivation. Theory Y shares similarities with the human relations movement, noting that workers can be trusted and are naturally motivated and efficient. The two theories made for crucial additions to management studies, and the human relations movement progressed by aligning individual needs with organizational needs.

Here are the basics of the two management theories, according to McGregor’s 1960 book, The Human Side of Enterprise:

Theory X: Negative outlook on workers

  1. Management is responsible for organizing company components in the interest of economic ends.
  2. Managers should direct workers’ efforts, motivate them, control their actions and modify their behavior to suit organizational needs.
  3. Managers must persuade, reward, punish and control workers to stop passiveness and resistance.

Theory Y: Positive outlook on workers

  1. Management is responsible for organizing company components in the interest of economic ends.
  2. Passiveness or resistance to organizational needs develops with experience in organizations.
  3. Motivation, potential for development, capacity for assuming responsibility and readiness to direct behavior toward organizational goals are naturally instilled in people.
  4. Above all, management should focus on creating a system where workers can achieve their own goals in line with company objectives.

Additionally, American psychologist Abraham Maslow developed a theory of hierarchical needs, which McGregor referred to in his book, to indicate employee incentives to perform well. From lowest to highest in the hierarchy, those are:

  • Physiological needs
  • Safety needs
  • Social needs
  • Ego needs 
  • Self-fulfillment needs 

Good managers understand these needs and the link between Theory Y and human relations and lead their teams in accordance with both theories.

What were the results of the human relations movement?

The human relations movement was a crucial event in management history and a significant contribution to today’s leadership types. The behavioral sciences helped managers and theorists understand how to increase productivity by ditching the primary focus on organizations over their workers. 

Contemporary theories, like the contingency theory and the systems theory, focus more on the importance and effect of every individual in a company and how they can achieve their own goals while benefiting their organization.

How can human relations management improve employee performance?

Some aspects of human relations management can be applied to the modern workplace. There are a few positive actions businesses can take to improve employee performance.

  1. Treat work naturally. Encourage employees to treat work as naturally as they would resting or playing. After all, this is one of the central points of human relationship management: Your team members exercise their skills in a professional environment. The more employees can treat work as a natural state, the easier this will become.
  2. Share the big picture. Share the overall theme and big picture of the job with employees. Everyone wants to feel valued and that their work contributes to greater success. When employees see how they fit into the big picture, they will be more motivated.
  3. Give employees more power. Everyone wants to feel independent, and nobody wants to feel like someone is constantly looking over their shoulder. Therefore, push employees to innovate and make independent decisions when appropriate.
  4. Train employees and develop their skills accordingly. Employees who feel the company invests in them are more likely to perform better. Encourage employee professional development, and increase your employees’ freedom and responsibilities as they grow.
  5. Reward success. Nobody wants to feel like their work is being ignored. Therefore, reward employees for their successes and ensure they know their hard work is being noticed. This will encourage others to work hard to achieve company goals as well.
Money isn't enough to motivate your employees. Consider rewarding employee success with flexible work policies, public recognition and increased decision-making power.

How can I learn more about human relations management?

Employees look to managers and leaders for guidance and assistance. For this reason, striving for self-improvement, improving your leadership skills and deepening your understanding of human capital management when you’re in a leadership position are crucial.

Consider learning more about human relations management by taking online courses, such as the human relations management course offered by Coursera and HRCI Learning

Additionally, organizations like the American Management Association offer in-person seminars as well as online educational materials. And HR software providers can be excellent resources for human relationship management education. For example, the best HR software solutions grant you access to self-guided learning platforms through which you can build your management skills. 

Relating to your employees

You’re managing and leading your team well if you’re guiding everyone toward meeting your organizational goals while treating your employees as people. This is the essence of the human relations theory, and it’s also why PTO policies, prioritizing a positive work-life balance and providing excellent employee benefits are such big HR topics. As a leader, you have the power to shape your employees’ lives, and human relations means shaping them for the better.

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Max Freedman, Business Operations Insider and Senior Analyst
Max Freedman has spent nearly a decade providing entrepreneurs and business operators with actionable advice they can use to launch and grow their businesses. Max has direct experience helping run a small business, performs hands-on reviews and has real-world experience with the categories he covers, such as accounting software and digital payroll solutions, as well as leading small business lenders and employee retirement providers. Max has written hundreds of articles for Business News Daily on a range of valuable topics, including small business funding, time and attendance, marketing and human resources.
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